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Oil Stocks As A Long Term Investment
By Giovanni Poshe
September 28, 2007 (1Source4Stocks.com)
– The demand for world oil is increasing while world reserves
are decreasing. This is a known fact. The current price of oil
can certainly confirm this statement. Consensus also agrees
that we will never see $25.00 oil again.
The logical conclusion to our above statement is oil stocks
should be a good long term investment. However, the location
of the oil companies' reserves can affect their bottom line
and valuation.
Some of the largest reserves in the world are
found in Venezuela, Saudi Arabia, Russia and Canada. Political
unrest in Venezuela, unstable and unpredictable government in
Russia and Osama Bin Laden targeting Saudi Arabia leave
Canada, namely the Alberta Oil Sands, as the largest, most
reliable oil reserves in the world.
Companies like Exxon Mobil Corp., Royal Dutch/Shell Group and
Canadian Natural Resources Ltd. are planning to spend billions
during the next 10 years to develop Alberta's unusual oil
deposits as demand for crude rises and output from existing
reserves decline.
Oil sands output in Alberta may double to 2 million barrels a
day by 2013, according to a presentation by Enbridge Inc.
earlier this month. Oil sands are deposits of bitumen - heavy
oil that must be treated to convert it into crude oil for use
in refineries to produce gasoline and diesel fuels. The U.S.
Energy Department revised its global oil resource estimates to
include the oil sands 174 billion barrels of proven reserves
that can be recovered using current technology.
With demand for oil and other commodities from China and India
increasing due to their growing economies, strong trading
relationships are procuring with Canada - a country with
numerous resources, political stability and neutral military
views.
Companies with reserves in the Alberta oil sands look like a
great investment for the next decade.
There are many companies with reserves in the Oil Sands here
are some with strong exposure.
Suncor Energy Inc.
(TSX:SU) , Western Oil Sands Inc.
(TSX:WTO) and the Canadian Oil Sands Trust
(TSX:COS.UN)
This article is intended solely for information
purposes. The opinions are those of the author only. Please
conduct further research and consult your financial advisor
before making any investment/trading decision. No
responsibility can be accepted for losses that may result as a
consequence of trading on the basis of this analysis.
Copyright © 2007 1Source4Stocks.com. All
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